Meat Deli products at a supermarket. (Photo: meatdeli.com.vn) In a recent report, Fitch Solutions said that total meat consumption in Vietnamis forecast to grow over 25% during 2018–2026. And pig farming has become anattractive business because pork is the main animal protein in Vietnamesemeals, accounting for about two-thirds of total meat consumption.
By 2026, each Vietnamese person will consume on average more than 51kg of meatper year, up 9% compared to this year’s expected consumption. Of which, 31kg ispork, more than 16kg is chicken, and more than 4kg is beef.
Strong businesses will also benefit from a potential recovery in pork prices inthe future, Fitch Solutions added.
In addition, after the African swine fever spread in 2019, smallholder farmersleft the industry because of expensive investments and volatile prices. This isa huge chance for big companies to jump in.
According to the financial report of Thaiholdings JSC, its subsidiary Thaigrouphas cooperated with a third party to invest 600 billion VND (25.3 million USD)in a pig farming project in Thanh Hoa province. Thaiholdings receives 60% ofthe total profit.
Previously, many domestic giants also poured trillions of dong into pig farming,including Hoang Anh Gia Lai JSC, Hoa Phat Group, Hoang Anh Gia Lai AgricultureJSC and Truong Hai Group.
In its August production and business report, Hoang Anh Gia Lai said that thecompany’s revenue reached 448 billion VND last month thanks to pig farming andbanana cultivation.
For the first eight months of the year, it recorded consumption of 136,075 pigsand 176,280 tonnes of bananas, of which it exported 112,740 tonnes and used54,540 tonnes as animal feed. Currently, the company has completed nineclusters of farms to raise more than 27,000 breeding sows and 600,000 slaughterpigs per year.
Meanwhile, Hoa Phat Group said that the agricultural sector helped it earn aprofit after tax of nearly 207 billion VND last year.
Moreover, many foreign-invested companies, including CP Vietnam Corporationunder Thailand’s CP Group, South Korean-invested CJ Vina Agri, andAustralian-invested Mavin Group, have also invested heavily in this market.
Particularly, the International Finance Corporation (IFC), a member of theWorld Bank Group, has so far poured a total of 2.8 trillion VND into three pigfarming companies, Mavin, BaF Vietnam Agriculture and GreenFeed Vietnam. Of which,GreenFeed is aiming to sell more than 125,000 tonnes of pork per year, whileMavin has an annual plan to supply the market with 900,000 tonnes of pork.
Fitch Solutions also reported on a trend of industrialisation in pigproduction.
According to the 2021 annual report of Masan MEATLife, a meatprocessing company under Masan Group, the Vietnamese pig market is worth about 15billion USD.
However, Fitch Solutions believes that the Vietnamese pig industry will facelong-term challenges as consumers gradually eat less pork. The financial dataservice provider said that during 2022-2026, chicken and beef consumption willincrease almost equally, at more than 13%, while the growth rate of pork willbe only half this rate.
Therefore, there will be more room for the chicken market to develop due to itsaffordable price. Many livestock enterprises have also started to invest inpoultry farming to catch up with the trend.
Masan MEATLife is one of the leading enterprises in promoting the trend afteracquiring the Vietnamese brand - 3F and applying technology in producingchilled meat to chicken products since the fourth quarter of 2020. In thisfield, the company achieved revenue of nearly 1.5 trillion VND in 2021, a gainof nearly 58% over 2020. The company will continue to invest in a market withan expected value of 5 billion VND in the future./.
VNA
